What Is Connected TV? How CTV Advertising Works (2025)

Advertising, Connected TV

TV isn’t what it used to be, and that’s a good thing for marketers. But how has it changed? Enter Connected TV (CTV). CTV has transformed the biggest screen in the house into a performance marketing channel. This key change has given brands the power to reach high-intent audiences with digital-level precision and real-time results (seriously).

In this guide, we’ll break down what CTV advertising is. We’ll also cover how it works and key reasons it’s become a core part of the modern marketer’s toolkit. Whether you’re launching your first campaign or trying to scale, here’s what you need to know to make Connected TV work harder for your brand in 2025.

What Is Connected TV?

Connected TV (CTV) is any television set that connects to the internet and streams digital video content. This can be done through built-in smart TV functionalities or external devices like streaming sticks, consoles, or set-top boxes.

This technology allows viewers to access tons of unique content beyond the constraints of traditional broadcast channels, including popular streaming services, on-demand videos, and internet applications.

What Is CTV Advertising?

CTV advertising is when marketers deliver advertisements through internet-connected television sets. Ads can be delivered anywhere that viewers are streaming digital content, such as through built-in apps or via devices like Roku, Apple TV, or gaming consoles.

Unlike old-school TV advertising, CTV ads allow for more targeted and personalized experiences for consumers. This is because CTV platforms leverage viewer data such as viewing habits, interests, and demographics. This approach enables more precise targeting, along with accurate measurement and tracking capabilities.

CTV Advertising vs. OTT Advertising

OTT advertising is the broad delivery of streaming TV content across any internet-connected device—phones, tablets, and desktops included.

CTV is a subset of OTT, focused specifically on streaming TV advertising shown on actual big screens, where the inventory environment is typically premium and performance-driven. Think big channels like CBS, NBC, CNN, and many others.

• Learn More: OTT vs. CTV

CTV Advertising vs. Addressable TV Advertising

Addressable TV advertising runs through cable boxes and offers some targeting, but it’s still tied to legacy TV infrastructure.

Again, CTV advertising delivers real-time performance and laser targeting on streaming platforms built for today’s digital marketers.

CTV Advertising vs. Linear TV Advertising

Linear TV advertising is what you see when you turn on broadcast or cable television. It’s the traditional, old-school form of TV advertising that has been around for generations.

CTV advertising offers significantly better targeting and measurement than cable TV advertising and other linear mediums.

If we could summarize these distinctions into a single sentence, it would be this: OTT is the delivery method, CTV is the screen, and addressable TV is cable’s attempt to play catch-up.

Benefits of CTV Advertising

Where to begin? The advantages of Connected TV advertising are numerous, and more and more advertisers are tapping into them every day. Here are the top five benefits of CTV advertising that you need to know.

1. Precision Audience-Based Targeting

Audience-based targeting allows marketers to reach specific consumers based on their interests, behaviors, and demographics. This enhances the relevancy of the ads delivered. Again, traditional TV advertising targets broad demographics based on programming, while CTV allows marketers to utilize first- and third-party data in their targeting.

2. Hyper-Localized IP-Based Targeting

IP-based targeting is a substantial advantage of CTV advertising as it allows marketers to deliver highly relevant and personalized TV ads to specific geographical areas based on device location.

This is particularly advantageous for local businesses (like car dealerships) or campaigns with a geographical focus, like trying to generate more foot traffic for a weekend sale.

3. High Video Completion Rates

CTV advertising typically garners high video completion rates due to the viewer behavior associated with the medium: users are generally more engaged and less likely to skip or close ads when watching TV content, as compared to other digital platforms.

This medium is often experienced in a lean-back setting, with long-form content, which naturally encourages viewers to watch ads in their entirety. For advertisers, this is highly beneficial as it ensures their entire message is seen and heard, potentially leading to better brand recall and engagement, a significant advantage over traditional mediums where ads may be skipped, ignored, or not viewed in full.

4. Accurate, Real-Time Measurement and Attribution

Tracking a wide range of metrics, including return on ad spend, revenue, website visits, and more, is another element that helps make CTV marketing an effective performance channel. It allows marketers to track metrics that matter most to their campaign.

What’s more, the metrics are available in near real-time, which gives you an up-to-date account of your campaign performance. And with accurate CTV attribution methods, such as MNTN’s Verified Visits™ technology, you’re able to see who converted on your website after viewing one of your CTV ads, even when they’re using a different device.

5. Automated Campaign Optimization

This is a little tricky since “automated optimization” has become a buzzword in the industry. But not all automation is created equal. Some ad solutions that say they can offer automated optimization use human media buyers behind the scenes, while others focus solely on lower CPMs (and lower-quality inventory) to optimize for reach.

Only MNTN offers performance-driven, automated optimization that balances your ad spend and goals to help you generate results with CTV ads served on premium CTV inventory. It leverages website visits and conversion data from real, verified outcomes to optimize bids in real time to drive performance. All while evaluating a near-endless amount of variables—from recency windows to underperforming elements—to ensure your campaign is operating at peak efficiency.

It’s this automation that introduces the right amount of efficiency, which makes CTV advertising a performance marketing channel.

How Does CTV Advertising Work?

Connected TV advertising allows brands to reach their audience on smart TVs, OTT devices, and various other CTV platforms. MNTN Performance TV gives brands the power to target their audience with Connected TV ads during premium, ad-supported shows provided by top-tier networks.

With MNTN, you can launch your own CTV advertising campaigns from a single platform in just four (4) simple steps. It’s very similar to paid search or social, with a familiar setup.

Step 1: Upload Your Creative

With MNTN just simply drag and drop your video file, or link your Dropbox or Google Drive to upload your ad. It’s completely intuitive and easy to use and allows you to use existing video assets.

Step 2: Select Your Audience

With MNTN, you can build your audience with first-party data or by tapping into thousands of audiences available through our unique integration with data providers (some ad solutions will tack on fees for audiences, but we aren’t about that). Not only can you target new audiences, but you can also retarget your current website visitors to re-engage them and move them further down the sales funnel.

Step 3: Extend Your Campaign

Having an omnichannel marketing presence is vital to any ad strategy. Your audience isn’t spending all of their digital time on one device or channel—rather, they’re streaming TV on their television while browsing the internet on their phone or tablet.

It’s important to reach your Connected TV audience through ads served on any device to help complement your CTV marketing campaign. The MNTN platform lets you launch companion ads that are aesthetically related to your CTV ad, both in look and message, to ensure you reach your audience wherever they spend their digital time.

Step 4: Set Your Budget & Launch

It really is that simple. The MNTN platform allows you to just enter your goal, budget, and start date — no bid required. Why no bid? Our automated optimization technology handles the heavy lifting for you to determine the optimal bid price for inventory that will reach your targeted audience and hit your goal. You can track your performance at any time with insight into site visitors, page visits, revenue, ROAS, creative performance, and more.

Where Are Connected TV Ads Shown?

Connected TV ads are shown on both paid and free ad-supported streaming networks and apps, which are accessed through smart TVs and other connected devices. The networks and apps are household names—think ESPN, MTV, ABC, and CBS—while the devices are in almost every living room in America (Apple TV, Roku, PlayStation, etc).

Every major streaming service now, from Netflix to Hulu, Paramount+, and Peacock, offers ad-supported tiers. This is because research has shown that cost-conscious streaming viewers (who often cut the cord on cable due to price) are looking for a lower bill. Ad-supported Connected TV is offered at a lower cost than ad-free, thus more subscribers sign up.

In fact, ad-supported tiers now account for 50% of subscriptions across major SVOD platforms, driving more inventory and lower costs for viewers. Not to mention, FAST services also reach 45% of US internet-connected households.

How Are Connected TV Audiences Targeted?

With MNTN, you can retarget site visitors or launch prospecting campaigns that reach brand-new audiences with ads on Connected TV.

First-Party Data

By using your first-party data, you can leverage your website traffic and retarget those users with Connected TV ads. You can also upload email lists from your CRM, and target those existing customers with high-impact CTV ads that are served on television screens.

Third-Party Data

Smart TV ads on CTV platforms allow you to use third-party data sources to reach new audiences. Audiences are generally segmented by several attributes, including personas, interests, demographics, age and gender, income, household, and intent information.

Frequency Caps

You’ll hear a lot about frequency caps regarding Connected TV advertising. Frequency caps aren’t necessarily a targeting method, but rather a way of managing the number of times an ad is served to a user. Too many ads served will generate ad fatigue and blunt the effectiveness of your message (and get on a lot of people’s nerves). It’s important to work with a CTV advertising platform that allows you to improve user experience by not serving the same ad to the same person over and over.

IP Targeting

IP targeting is another way to reach specific audiences on Connected TV. This is a method that bypasses the problematic cookies method of many other digital channels. It also allows CTV advertisers to target entire households and the connected devices within them.

CTV Metrics and Measurement

Since Connected TV is a digital ad channel at its core, it uses traditional digital marketing metrics and KPIs as a way to measure performance. Here are a few key ones everyone should know, especially if they are going to use CTV ads for performance marketing campaigns.

Impressions

This is the number of ads served to viewers and helps you understand the scale of your campaign as it is served out across TV screens.

Return on Ad Spend (ROAS)

Return on Ad Spend (ROAS) is a performance metric that shows you how much revenue your campaign has generated in relation to the total amount of ad spend. The higher your ROAS, the better—that means your CTV campaign is returning exponentially more money than it costs to send out.

Cost per Completed View

This metric tracks, well, the cost per completed view. That means it shows how much of your campaign’s budget is being spent on each completed view. What makes a view “completed”? It generally means that the ad was viewed all the way through, from start to finish. However, on some CTV ad platforms, a completed view can be slightly less than that.

Cost per Acquisition (CPA)

Similar to ROAS, this is another performance marketer metric. It tells you how much your campaign had to spend for an acquisition. This can be a sale, a form signup, or whatever the intended “acquisition” action is for the campaign. This shows how efficient your campaign is in capturing acquisitions, and the lower the CPA, the more efficient it is.

With the digital side covered, we also should explain a few of the more traditional TV metrics that have crept their way into the CTV measurement lexicon.

Reach

Reach is the number of unique people who will be exposed to your Connected TV ad. It’s often shown as a percentage of a specific audience; for example, 75 percent of 18 to 24-year-olds. It indicates the percentage of the targeted population that has seen at least one traditional or Connected TV spot.

Frequency

Just because you delivered one million impressions doesn’t mean that one million unique people viewed your ad. Frequency is the average number of times you’re delivering an ad to a given person. Knowing your frequency means you can prevent the same ad from being served to the same person over and over again. So, if you deliver 3,000 ads to 1,000 unique people (your reach), your frequency is three.

GRP (Gross Rating Point)

GRPs have been around before the internet even existed. It’s used to determine how many people within an advertiser’s target audience saw an ad. For example, let’s say you want to target males between the ages of 18 and 34. You know that 30 percent of viewers in this demographic watch a certain sports game on Sunday night, so you purchase four commercial spots while the game airs. Since you are reaching 30 percent of your target audience, and are serving them roughly four ads each, this would get you to a GRP of 120.

CPP (Cost Per Point)

CPP measures how well, for the price, your ads reach your desired audience. Once you have your GRP, your CPP is simply your total media cost divided by your GRP. It’s what you’re paying per gross rating point.

Cross-Screen Measurement

A slightly self-explanatory term — with cross-screen measurement users can track and measure video metrics across different devices, such as mobile, television, OOH, Connected TV, and desktop.

Target Rating Point

This term is a metric for the percentage of the advertiser’s target audience that views its advertisements. These target audiences are the groups of customers most likely to purchase a company’s products and services and can be essential to a successful campaign.

Connected TV Devices

What are Connected TV devices? Well, there are quite a few to choose from, and there are many ways to stream CTV or OTT content. These are also the platforms where your CTV advertising campaigns will be shown.

Tablets, Phones, Desktops

You don’t need a TV to actually watch TV anymore. Although traditionally considered OTT devices, household devices like tablets, phones, and desktops have been transformed into mini-television sets that stream content.

OTT/CTV Devices

OTT and Connected TV devices connect to your TV to allow for a continuous stream of content, meaning that as long as your internet connection is not disrupted, you don’t need to wait for an entire piece of content to download before hitting play. Popular examples are Roku, Chromecast, Amazon Fire Stick, Apple TV, and the major gaming consoles.

Smart TVs

If you’re buying a big screen these days, you’re most likely buying a Smart TV. This is a television with a built-in connection to the Internet; no sticks or dongles are required.

CTV Marketing Best Practices

Given the rapidly growing user base of Connected TV devices, it’s important to consider the following items when developing your campaigns:

• Understand Your Audience: Before you start, make sure you understand your target audience well. Ads should be developed with them in mind.
• Use High-Quality, Engaging Creatives: Connected TV is premium inventory. Make sure you have an ad to match.
• Leverage Advanced Targeting: Harness CTV’s powerful targeting capabilities. Brand awareness campaigns can work fine, but CTV is built for highly focused targeting.
• Make It Interactive: Boost engagement with interactive ads. Invite viewers to learn more about your brand, or even make a purchase.
• Implement Frequency Capping: Cap how often your audience sees your ads to help limit ad fatigue. This improves the overall user experience.
• Measure and Optimize: Don’t ignore your reporting! Use real-time insights to track campaign performance and refine your ads over time.
• Embrace Cross-Device Advertising: Expand your reach with a cross-device strategy. Audiences use different devices depending on where they are. Meet them there.

CTV Advertising Examples

There are tons of great Connected TV advertising examples to demonstrate true “living room quality.” Here are a few of our favorites.

MNTN

Our first example is one put forward by MNTN (that’s us), starring our very own Chief Creative Officer, Ryan Reynolds. We admit we may be partial, but it’s for good reason – we deploy our proprietary CTV advertising platform to boost our brand, and it works. Take a look!

Rumpl

Rumpl explored CTV advertising with a remarkable commercial showcasing their incredibly stylish and cozy blanket made entirely from recycled materials. This compelling ad instantly draws the viewer in and deeply resonates with the adventurous wanderer’s spirit.

Replacements

For those who enjoy sophisticated and stylish dining table decorations, Replacements is a perfect fit. This CTV advertisement adheres to a proven strategy, outlining a common issue, offering a resolution, and demonstrating the solution, all within a 30-second window. Right to the point!

1Password

Let’s take a look at another ad featuring Ryan Reynolds. Why not? This CTV example spotlights 1Password, a state-of-the-art cybersecurity password manager aimed at securing all your digital information. It’s another funny and memorable creative that doesn’t beat around the bush.

CTV Marketing With Performance TV

Ready to take the reins on your CTV advertising? MNTN’s performance-driven platform is all about driving real wins—not just racking up empty impressions. Picture this: you’re hitting premium audiences, tweaking things as you go, and tracking every single conversion like a pro.

Here’s what you get with MNTN Performance TV:

• MNTN Matched – AI-driven targeting pinpoints your ideal audience and serves ads at the perfect moment.
• Verified Visits™ Attribution – Connects ad views to site visits and conversions with industry-leading precision.
• Automated Optimization – AI continuously fine-tunes your campaigns to maximize performance without manual effort.
• Premium CTV Inventory – Get guaranteed placement on top streaming networks, putting your brand in front of engaged viewers.
• Reporting Suite – Access real-time performance insights to track results and refine your strategy with confidence.

Power up your CTV strategy with MNTN’s self-serve software—sign up today to get started.

Connected TV Advertising: Final Thoughts

U.S. CTV ad spending is projected to reach $44.7 billion in 2026, and it’s easy to see why. CTV advertising is redefining marketing with its blend of premium content and digital precision. By utilizing highly focused targeting options, real-time analytics, and interactive ad formats, brands can create campaigns that resonate on the largest screens in the house.

With Connected TV statistics showing rapid adoption and steadily growing viewer engagement, there’s never been a better opportunity for marketers to harness this powerful channel.